Cement Energy and Environment

because m1mng is captive for many steel, metal or power generating businesses and hence the' final profit arises from the sale of products and not from mining. The panel (group of ministers) is aware of the confusion the clause has generated and is willing to dilute and even change it, said one of the two persons connected with the issue. This development was also confirmed by the head of a large state-run company, who requested anonymity as he is not authorized to speak on the issue. The profit-sharing clause attracted popular attention as it sought to make displaced people owners in m1nmg operations and was said to have been inspired by the Black Economic Empowerment Act of South Africa, a legislation intended to increase black ownership of businesses. The mineral-rich parts of India are also those with large tribal populations , who are amongst India's poorest. The profit– sharing clause was intended to compensate landowners by ensuring they benefited from industrial development. On the sidelines of a seminar on steel in Delhi, Mines Secretary S Vijay Kumar said the government was planning to present the bill in the budget session of parliament. A final meeting of the inter– ministerial panel, which has been postponed since September last, has been cited as the only loose end before the bill is tabled , said people associated with the bill. But the schedule for the tabling of the bill has changed many times. Last year, the mines ministry said it would be ready for the winter session of parliament. "The draft should include methodology for calculating the profit sharing. Companies these days have different financial statements due to the migration to the globally uniform International Financial Reporting Standard. In some cases, two sets of statements are prepared, one for IFRS and one as per Indian standards," said the head of the state-run company cited earlier. Mining companies have opposed the 26 per cent profit– sharing clause as it would impact profitability. They have proposed alternatives, including annuity payment and a share of the royalty in a dedicated fund . Companies have also suggested the government impose a 15 per cent export duty on ores which will encourage value addition. Major mining firms include NDMC, Sesa Goa, Coal India, SAIL, Tata Steel, Nalco and others. Companies claim they would have to pay out as much as Rs.25,000 crore if the profit-sharing clause is implemented, reducing employable funds and cutting the annual investment by the mining industry by about Rs 50,000 crore. Speaking to ET from Delhi, Federation of Indian Mineral Industries, Secretary– General R K Sharma said the mining sector had been appraising the government about the impact of the profit– sharing clause. Courtesy: FIMI (Federation of Indian Mineral Industries) News Bulletin, 15th March, 2011, Pp 22-23. RAJASTHAN GETS NEW MINING POLICY The Rajasthan cabinet recently adopted a new mining policy after a gap of 17 years to promote value addition in mining, generate employment, and exploit the mineral wealth of the state judiciously while balancing environmental considerations. The new policy is a bold step in that it abolishes the ministers' discretionary powers for allotment of mining leases. Chief Minister Mr. Ashok Gehlot said that the policy, brought in with immediate effect, would lay emphasis on projects based on crude oil , gas, lignite, limestone, sandstone, clays and marble, and reserve 50 per cent of the mining areas for various categories. The remaining 50 per cent would be disposed of through auction. The new policy - the third for the state after the previous policies announced in 1977 and 1994 - would bring in transparency and efficiency in mining operations and minimize the scope for illegal activities, corruption, and creation of mining mafia. Courtesy: [ TERI (The Energy and Resources Institute) Newswire, 16-31 January2011, P18. Energy NO CAPTIVE COAL The coal ministry wants to take back 31 coal blocks allotted to companies for captive mining, which have been lying idle for more than three to four years. Instead, the government should overhaul the moth-eaten policy that governs the coal sector. Today, only state-owned giant Coal India Ltd (CIL) is allowed to mine and sell coal in the market; a smaller state owned entity, Neyveli Lignite, which mines lignite for power generation, is allowed to sell extra output to small industries. Other companies, including large private players like Tata Steel, JSW, JSPL, Reliance Power and Hindalco and state-owned util ity NTPC, are allotted coal mines, but for captive use. This means they can mine coal and use it to 17